The Committee on Education and Public Works proposes the following Amendment No. 1 to H. 3101 (COUNCIL\CM\3101C001.GT.CM21):

Reference is to the bill as introduced.

Amend the bill, as and if amended, by striking SECTION 1 in its entirety and inserting:

/SECTION 1.Chapter 5, Title 56 of the 1976 Code is amended by adding:

"Article 40

Disposition of Motor Vehicles by a Salvage Pool Operator Subject to an Insurance Claim

Section 56-5-5710.( A)As contained in this section, 'salvage pool operator' means a person who engages in the business of selling salvage motor vehicles at auction, including wholesale auction.

(B) This section applies only to a salvage pool operator who, on request of an insurance company, takes possession of a motor vehicle that is the subject of an insurance claim and the insurance company subsequently:

(1) denies coverage with respect to the motor vehicle; or

(2) does not otherwise take ownership of the motor vehicle.

An insurance company described in this subsection shall notify the salvage pool operator of the denial of the claim regarding the motor vehicle or other disposition of the motor vehicle. The insurance company must include in the notice the name and address of the owner of the motor vehicle and the lienholder, if any.

(C) Before the thirty-first day after receiving notice under subsection (B), a salvage pool operator shall notify the owner of the motor vehicle and any lienholder that:

(1) the owner or lienholder must remove the motor vehicle from the salvage pool operator's possession at the location specified in the notice to the owner and any lienholder not later than the thirtieth day after the date the notice is mailed and if removed during this time period, there will be no charges assessed against the owner of the vehicle save the actual costs of providing the notice described herein; and

(2) if the motor vehicle is not removed within the time specified in the notice, the salvage pool operator will sell the motor vehicle and retain from the proceeds any costs actually incurred by the operator in obtaining, handling, and disposing of the motor vehicle as described in subsection (D).

(D) The salvage pool operator may include in the costs described in subsection (C)(2) only costs actually incurred by the salvage pool operator that have not been reimbursed by a third party or are not subject to being reimbursed by a third party, such as costs of notices, title searches, and towing and other costs incurred with respect to the motor vehicle. The costs described in subsection (C)(2):

(1) may not include charges for storage or impoundment of the motor vehicle for the first thirty days that the vehicle is stored with the salvage pool operator but may include a reasonable fee for every day of storage thereafter until the vehicle is disposed of; and

(2) may be deducted only from the proceeds of a sale of the motor vehicle.

(E) The notice required of a salvage pool operator under this section must be sent by registered or certified mail, return receipt requested or by a private delivery service which is acceptable to the Internal Revenue Service.

(F) If a motor vehicle is not removed from a salvage pool operator's possession before the thirty-first day after the date notice is mailed to the motor vehicle's owner and any lienholder under subsection (C), the salvage pool operator may obtain from the department:

(1) a salvage vehicle title for a salvage motor vehicle; or

(2) a nonreparable vehicle title for a nonreparable motor vehicle.

(G) An application for a title under subsection (F) must:

(1) be submitted to the department on a form prescribed by the department; and

(2) include evidence that the notice was sent as required by subsection (C) to the motor vehicle owner and any lienholder.

(H) A title issued under this section must be issued in the name of the salvage pool operator.

(I) The department shall issue the appropriate title to a person authorized to apply for the title under this section if the department determines that the application is complete and complies with applicable law.

(J) On receipt of a title under this section, the salvage pool operator shall sell the motor vehicle and retain from the proceeds of the sale the costs incurred by the salvage pool operator as permitted by subsection (D) along with the cost of titling and selling the motor vehicle. The salvage pool operator shall pay any excess proceeds from the sale, first to lienholders in order of priority to satisfy the liens and the remainder, if any, must be sent to the owner in the same manner as provided for in subsection (E).

(K) If the previous owner of the motor vehicle and the lienholder, if any, cannot be identified or located, or the owner does not respond to the notice sent to the owner in the manner provided for in subsection (E), any excess proceeds from the sale of the motor vehicle under subsection (J) shall escheat to the State of South Carolina. The proceeds shall be administered by the Comptroller General and must be disposed of in the manner provided by law." /